Arditto said to Reiner, ‘I guess you’d better pay them back the ten thousand.’
Reiner walked out of Arditto’s office in a huff. He walked straight to his lawyer’s office and told the lawyer what had happened, and he mentioned the Hughes Tool Company. The lawyer looked up the mortgage property and found that it belonged to Hannah Nixon, the Vice-President’s mother.
Reiner was a Democrat and his lawyer was a Democrat. Zing, they saw the implications of the whole thing, and the lawyer in Los Angeles sent Reiner to Washington to talk to another lawyer, a guy named McInerney, a close friend of Bobby Kennedy.
McInerney and the Kennedys got together. But they still had a problem. They didn’t have any real evidence, and they knew nothing at all about the additional two hundred grand that had gone through the Cayman Islands. They only had Reiner’s version of the mortgage story, but they didn’t have any actual proof that Reiner was a dummy for Toolco, and Reiner didn’t want his head on any chopping block. There was a notarized paper that spelled it all out, but Reiner didn’t have it. He’d given it to Arditto as part of the so-called security arrangements, and Arditto had locked it in a safe, and for all the Kennedys knew had even destroyed it after the first phone call came from Houston saying, ‘What’s going on?’
Now comes a little ironic twist in this. Jack and Bobby Kennedy wanted Reiner to be as clean as possible in the event they could get the evidence and break the story, so they gave him $10,000 – or whatever the total of the rent money was that Reiner had received for holding the trust deed on the Whittier property – and told him to return it to Arditto. Reiner returned it, and eventually it made its way back to Toolco. The irony, if you boil the money trail down to its simplest elements, is that the Kennedys paid the mortgage on Dick Nixon’s mother’s gas station in Whittier.
And then – well, I’ve said this before but I’ll say it again. The stupidity of intelligent, educated people never ceases to amaze me. Quite a while ago Arditto had Xeroxed the Nixon mortgage file, and put a copy in Reiner’s filing cabinet. Why he did that we never found out. Reiner never knew it was there – it was buried in with a lot of junk.
A few days after he got back from Washington to Los Angeles, Reiner called Arditto to make sure the check for $10,000 had been received, and Reiner said, ‘Oh, by the way, I left some papers in your office. Would you mind sending them over to me?’ He was setting up new office space for himself in Santa Monica. So Arditto emptied out the desk and the filing cabinet – didn’t even look what was in it – and sent it to Santa Monica.
Reiner casually looked through it before he put it in a new file cabinet. There was the copy of the Nixon file. Most important, there was the notarized paper setting him up to hold the trust deed.
I know that seems an incredible story, but it’s really not so incredible, not if you accept the fact that intelligence is an ability, not a permanent state of mind. People don’t seem to be able to use their intelligence more than a few minutes a day.
Arditto forgot to plug in his intelligence that day, and he just said, ‘Get these files the hell out of my office and over to this guy’s new office in Santa Monica.’
This was shortly before the elections. Reiner gave all the material to McInerney, who put together a reasonably accurate account of the whole deal and fed it to the newspapers.
But they wouldn’t publish it. They didn’t believe it.
But McInerney and Reiner had proof.
Proof is only proof when you’re in the mood to believe it’s proof. I think the newspapers didn’t want to be accused of a last-minute smear campaign against poor Dick Nixon, who had been knocked from pillar to post already by Jack Kennedy. Maybe they figured it wasn’t dignified. The only guy who would touch it was Drew Pearson, and even he said, ‘Not until after the election.’
I watched from afar. Although Pearson and the newspapers wouldn’t touch the story, they did make a few inquiries to the Nixon people, and Nixon panicked. He must have convinced himself that he’d better scotch the snake before it bites. After all, he was paranoid, and he didn’t know the newspapers didn’t have proof or were reluctant to print it. He knew it was true and he couldn’t be sure the newspapers didn’t know it was true.
Robert Finch, his campaign manager, came roaring out and made a statement to the press that there had been a personal loan to Donald Nixon by his old friend Frank Waters, Arditto’s partner, and Howard Hughes and Toolco had nothing to do with it, and Dick Nixon hadn’t known anything about it, he was pure as the driven snow. They called it a last-minute smear attempt on the part of the Democrats.
Drew Pearson blew his top at this hypocrisy and decided not to wait until after the election, and he broke the story with all the details – in fact, quite a few more details than the accountant and McInerney had supplied him with.
That came about because I had come to the conclusion over the years that Nixon was not very bright. Cunning and wildly ambitious, but not intelligent. Not eccentric. Common. Vulgar. I’d watched him on television and he always looked to me like a vacuum-cleaner salesman who just knocked on your door and is trying to sell you an out-of-date model. I had decided that Jack Kennedy was the better man. I was fond of the Kennedys, especially Bobby, and I thought the country needed a president who didn’t have a brother who made Nixonburgers. So the rest of the details leaked to Drew Pearson. Not all, not everything I’ve told you, but more than the file showed. Someone whispered in Mr. Pearson’s ear where to look. Mr. Pearson looked, and Mr. Pearson found.
Finch tried to deny Pearson’s accusation, but he had to admit, finally, that the money had come from Toolco. However, Richard Nixon hadn’t known anything about it and no favors had been done in return for it, which any human being with even a quarter of a brain could see was a blatant lie.
There was a hell of a fuss. This was a week or two before the election – a touch and go situation, if you recall. Nixon was already in trouble because he hadn’t done well in the TV debates against Kennedy – too much five-o’clock-shadow, they said.
Some people say that loan cost Dick Nixon the presidential election. I never saw myself as a power behind the scenes in Washington, but I did my bit. Every businessman need friends in high places. I did my bit, and I saw to it that Jack Kennedy knew that I did it.
Did you tell Pearson about the second Cayman Island loan?
No one has ever known about that until now.
Can you give me some more details?
I’ve probably told you too much already. If that ever came out, Nixon would probably be impeached. I’m pretty sure that taking a bribe, even though he was only Vice President when he took it, fits the founding fathers’ definition of ‘high crimes and misdemeanors.’
But it’s going to come out in your autobiography.
Let the chips fall where they may.
26
Howard makes promises he can’t keep, buys jets he can’t pay for, negotiates at a garbage dump, makes a grown man cry, fires his oldest employee, gets married again, and hunts for a missing cat.
I’VE ALREADY TOLD you about the beginning of my involvement with TWA. But it was a three-act drama, and now I’m going to tell you Act Two. I had dozens of lawyers and advisers on this case who were milking me dry, telling me: ‘Don’t do this, Howard,’ or, ‘If you do that, Howard, the jig is up.’ Night and day they nagged at me. I felt like one of those experimental rats that keeps getting new charges of electricity shoved up his ass no matter which part of the cage he moves to: ‘Let’s see how long he can stand it, before he goes nuts.’
This all started in 1954, although the real crisis came later and lasted six years, from 1957 to 1963. If I hadn’t loved that airline so much, I would have walked out and said, ‘Let it go down the drain.’ It took ten years off my life. What it did to my marriage and my personal effort to get my head clear, can’t be measured in years or any other form of measurement. Of course in the end I have no one else but myself to blame for allowing it to happen
, but you never see that when you’re in the thick of battle.
The man I got to replace Jack Frye was Ralph Damon, who at that time ran American Airlines. He’d done good things with American, but they weren’t going anyplace then and TWA was. So I made it known to him that I was interested in his meeting with me, with a view to his becoming president of TWA. This has to be done carefully, because it’s not considered good form to go around propositioning the president of one airline to take over the presidency of another. Damon had to sneak away from his offices, and I had to take extreme security precautions at the time. As a result, Damon sat in a hotel room for four days in Beverly Hills waiting for me. I didn’t know where he was and I didn’t know when he was supposed to arrive, and he knew even less about my whereabouts. When I didn’t show up he got annoyed. I don’t remember who he was in touch with then, but he told them he never wanted to hear from me again.
Of course that wasn’t true. We arranged another meeting, this time in Houston. I checked into the Rice Hotel under another name. But I forgot to tell Ralph Damon the details. So he checked into another hotel in Houston and we spent two days without either of us knowing the other was there or how to get in touch.
I was there in my room catching up on my sleep. You know, I can go up to forty-eight hours without sleep, but then every now and then I need a long stretch in bed, a good hard bed with a board. I can sleep for twenty-four hours. It doesn’t happen often, but it happened then, and while it was happening Ralph Damon was running all over Houston like a chicken with its head cut off, and finally he left.
He said a second time, ‘I never want to see that fucking Howard Hughes again.’
The point, of course, was that he had never seen me.
I never did get to meet him. Eventually I got Noah to arrange things, because Noah operated in a more conventional manner. Noah offered him the job and we signed him up for five years.
Ralph Damon was a fine president. He was able to act on my decisions as few other men have. TWA was the first airline to come up with the idea of the two-class service. That was my idea. I got hold of Ralph on the phone and I said, ‘People are snobbish. If we divide that plane into two sections, quite a few passengers are going to pay a lot more money just to ride forward in the first class section separated from the cattle in the back, and the people in the back are going to feel they’ve got a bargain. It’s a win-win situation. Sales will go up.’
Ralph grasped the concept, and did it. That put TWA on the map again as a pioneer. And that’s become the standard system for airline passenger traffic.
But I tried to stay away from Damon because he was an excitable man. I heard once, and I have no reason to doubt it, that after a telephone conversation we’d had, he cried himself to sleep. I felt terrible about that, because I don’t think I said anything to hurt his feelings. Maybe he had difficulty that time in interpreting my suggestions.
Unfortunately, he died while he was still president of TWA. Some people say that I drove him to his grave. It wasn’t true. He had cancer of the intestines.
Did you have more TWA stock, at this point, than the original stock you’d bought?
I had been buying the stock all along. I’m a heavy plunger. I believe in putting all my eggs in one basket and watching them hatch.
The situation after the war was as follows. All the airlines were running piston aircraft, but the jet age was just over the horizon and you had to be blind not to see it. They thought the propjet, the turboprop, would bridge the gap for a while, but that was a mistake. The gap narrowed too quickly. In the early 1950s all the airplane manufacturers – Douglas, Boeing, Lockheed, Martin, and the Convair Division of General Dynamics – were scrambling to get jets into production. Everyone wanted a piece of the action. And all the airlines were trying to make up their minds which manufacturers to buy from.
A conversion like this meant huge loans, many hundreds of millions of dollars. The ones who were really licking their chops were the banks. You don’t just say overnight, ‘Okay, scrap the piston planes and buy the jets.’ Not only was it a tremendous financial investment, but it involved retraining programs of pilots, mechanics, personnel of all types, changeover of hangar facilities and ground facilities. It was not something anyone plunged into. You could have been jumping off the diving board into an empty pool.
But anyone with a half a brain knew that the pool was filling up and the plunge had to be taken. I flatter myself that I’ve got half a brain. I went shopping. I decided right away that Boeing and Convair were going to make the planes to fit my needs.
Again, that decision was not so simple, because it’s not like buying a vacuum cleaner from a salesman who comes in and says, ‘See? This is our vacuum cleaner. Try it out. If you like it, buy it.’ Unlike the vacuum cleaner, the planes didn’t yet exist. And if we were going to buy a jet from Boeing, we had to tell Boeing precisely what our needs would be. To give you an example, each plane has a different seating potential. These planes were mocked up in the initial stages so that you could have a bank of three on the starboard side and a bank of two on the port side, or similar combinations. Dozens of other configurations had to be specifically arranged between the manufacturer and the airline.
With my attention to details, and you know what I’m talking about because you’ve read my memo about Jane Russell’s brassiere, I think I drove those airplane guys up the wall. But they let me do it. The men are who run American business receive annual salaries that run into the tens of millions of dollars. And yet if their companies prosper, it’s usually in spite of them, not because of them.
In 1955 I decided to buy jets from Jack Zevely, the boss at Convair. I was late making up my mind, but I finally did make it up. However, Jack thought I was a bit peculiar because of the way we started negotiations. I didn’t want the other airlines to know which planes TWA was going to buy. Moreover, I wasn’t sure that I was going to buy them at all. Beyond that, I wanted to keep the other manufacturers, like Boeing and Douglas, on the hook a little bit – so everything had to be done with the utmost secrecy.
I conducted my negotiations with Jack where I usually conduct my negotiations. I would instruct him to meet me in a specific remote area. One time we met at Indio in the California desert and then I drove him to a spot adjacent to the municipal garbage dump in Palm Springs. It was a hot night. Jack kept saying, ‘Open the windows, Howard.’
I said, ‘No, let’s keep the windows closed so we can talk privately.’
‘It’s stifling,’ Jack complained.
I finally opened them, with great reluctance, and then he realized we were next to the municipal garbage dump. The stink came through the windows of the car, and he yelled, ‘For Christ’s sake, Howard, close the windows!’
TWA didn’t buy those jets from Convair, which disappointed Jack a great deal, because there had been protracted negotiations. The problem was that Ralph Damon had already made arrangements to buy another plane from Douglas Aircraft, and I had to back him up. He’d put his signature on paper – all I’d done was talk to a man a few times in a car. I chewed Ralph out for acting without my final approval, and I guess that’s the time he cried himself to sleep. I called him a few nasty names. I thought he was a big boy and could take it, but I guess he couldn’t.
I felt bad about breaking off the negotiations with Convair. They had plans to build a long-range jet, so I went to them and said, ‘I want a dozen.’ But they were slow. God, they were slow. Actually I worked with Jack Zevely on the design, and Jack has made statements since then that he never could have designed that plane without me. As it turned out, unfortunately, he couldn’t sell that one to me, either, because the planning took so long that by the time we’d finished it, the prototype of the Boeing 707 was in the air, the Dash-80, and the Douglas DC-8 hard on its heels, and Convair was out in the cold. Boeing and Douglas had made better planes.
Convair blamed me for this. But Jack Zevely didn’t have to do what I said. Any time he wanted to, Ja
ck could have frozen the design and put that ship on the production line. He didn’t have to listen to me – I wasn’t God.
I started negotiating at one point with Lockheed, with Bob Gross. But he knew me too well and once I started making too many demands he turned the tables on me. One night at around 10 P.M. my private telephone rang. For once I happened to be asleep. I woke up quickly, alarmed, because no one who had that number would have called me at that hour unless it was on a terribly important matter. I grabbed the receiver and croaked, ‘Hello? What’s the matter?’
A voice said, ‘Knock, knock.’
I was too befuddled to say anything except, ‘Who’s there?’
‘Howard.’
I recognized Bob Gross’s voice, but I thought I might be wrong, and I was still dazed, so I said: ‘Howard who?’
Bob Gross said, ‘Howard you like to go fuck yourself, you goddamn maniac!’
Then he hung up, and I couldn’t get back to sleep – so he had his revenge for all those nights I’d driven him around the Nevada desert.
Meanwhile the Convair management was running around in circles. They abandoned the long-range jet and decided to go for something in-between, an intermediate. I still felt bad about what had happened, so I called Jack Zevely and found out what he was doing. I said, ‘I have complete faith in you and Convair, and I want the first thirty medium-range planes that roll off the line. ‘And let’s paint them gold, not silver.’ My engineers had developed a process to anodize aluminum so that it looked like gold, blazed in the sun, wouldn’t pit or tarnish. I offered it to the Convair people at no charge and they were delighted.
They came up with the CV-880. But it was supposed to be a medium-range aircraft, and it turned out to be a long-range jet, which meant it had to compete with the DC-8 and the 707, planes that were already operational. The 707 was a tremendous success right from the word go. Not as fast as Douglas’s plane, but handled nicely, a sturdy aircraft. She had problems, of course. Landing was one of them – they’d built the engine pods a little too close to the ground to keep them away from the fuel tanks in the wings, and on a crosswind landing you had trouble banking her, you could knock off a pod on the runway. And they’d yaw a lot if the damper wasn’t functioning one hundred percent.
Howard Hughes Page 34